The BuildGroup Prequels: Episode 2

In Lanham’s book, Billion or Bust, he talks about joining Rackspace when it was in startup mode and how he helped lead it into one of the world’s leading managed cloud service companies with over 6,000 employees and a billion-plus in revenue.

Spoiler alert: Building a company is hard.

And stories like this would be fictional (see fantasy) if not for the real-life electricity generated by people when they’re connected to each other and the belief in a company’s mission.

I hope you enjoy the stories. And since BuildGroup is creating ways to make the sequel even better, we’d love to hear yours.

Strong Partnerships Create Strength

Graham Weston and I talked every weeknight because our phone conversations helped keep our working relationship strong. We also met weekly for a couple of hours. Talking frequently made us better business partners, and we knew that to stay aligned with each other, we had to put in the time.

I liked that Graham had big ideas; was open minded, creative, and driven; and possessed courageous vision. Although his family heritage involved the British upper crust, he had grown up in San Antonio. After starting a successful photography business in high school, he went to Texas A&M University. He spent his early career in commercial real estate and then invested in and became CEO of Rackspace. Graham had absolute belief in the company and formed the foundation of the idea that Rackspace was here to stay. His view was that it would be around for a long time, and we would all do good things. One of his biggest contributions to Rackspace was our culture.

In 2003, some managers and executives at Rackspace went to a leadership seminar in which people’s strengths and weaknesses were determined and a path toward better leadership was developed. Graham didn’t agree with how the assessment of his leadership style was done. Dissatisfied, he went out to find an evaluation system that he liked, one he felt could be used for developing our people and culture. He found a system called StrengthsFinder, which helps people identify their strengths and then use them in the workplace. People who use their strengths every day are more likely to be engaged and productive, and less likely to quit their jobs. Graham loved the StrengthsFinder system and became highly committed to seeing it through as a way for Rackspace to develop a culture based on strengths.

He went to a seminar to become a coach for StrengthsFinder, and began using it to figure out how each Racker’s strengths could best fit into teams and the company as a whole. He started experimenting with creating teams, trying to fit people’s strengths together like Lego pieces. I was happy Graham wanted to use a system to develop people and a great culture at Rackspace, but he and I could frustrate each other. Most of all, what frustrated me was that working through his ideas, whether good or bad, took up a lot of time and resources that I didn’t feel I had.

Any idea, no matter how good it is, takes a number of people to implement. The trouble with ideas is they don’t come with magic dust to implement them and turn them into profits. As the guy responsible for leading the company operations, implementing the best ideas, and getting things done well and on time, I spent lots of cycles turning strategic thinking into sustainable growth and profits. I was outcome-oriented, had a sense of urgency, and made sure to mobilize Rackers to deploy new products and achieve goals.

Our big picture, the driving idea above and beyond all others, was that Rackspace needed to become one of the world’s greatest tech-enabled service companies. If we delivered incredible outcomes to our customers, we could put a dent in the universe. This meant hiring and developing Rackers who worked hard to serve clients in the Fanatical Support way.

While Graham wasn’t physically present in the office frequently, Lew Moorman had a mainstay physical (and intellectual) presence. He was super-smart and completely committed to doing great things, believing in the Fanatical Support mission and strategy with every fiber of his being. He was one of the more intense people I’ve ever known, and he dug into data vigorously, rarely content to rely solely on reports. He liked to generate real insights, and he came up with cool solutions and guideposts for Rackspace based on his insights. I admired his data presentation skills — he could develop exactly the right PowerPoint graph for exactly the right data and strategy consideration. His visualizations of our strategy showed analytical precision and creativity.

With those skills and the articulateness you’d expect of a Stanford law grad, Lew impressed people immediately. He worked a crowd with ease and had a keen awareness of those around him, a natural presence, and a charisma that inspired people. He was more socially intelligent than most people. StrengthsFinder has a trait it calls “Win Others Over” or “WOO.” Lew was so good at WOO that Rackers sometimes called him Woo Moorman. Lew also combined his seriousness and intensity with an ability to have fun. I remember we once held a core values boot camp that had a fun water-dunking booth. He got in there and hammed it up with the best of them, playing off his character as Woo Moorman.

A while into his tenure as senior vice president, Lew wanted me to make him president. I knew that title meant a lot to him, and we’d lose him if I didn’t acquiesce. I had the normal concerns you’d have when making a promotion, trying to understand the puts and takes of him in the president role. As smart as he was, he also could be opinionated to the point that he sometimes wore out people’s saddles. He loved to debate, and he was a business man who did not gladly suffer fools. I worried that this could dent morale. All things considered, I knew we’d lose Lew if I didn’t promote him to president. I very much wanted to keep Lew’s admirable strengths working toward the great, big future of Rackspace. I knew my agreeing to make him president could lead to problems with me because I myself found Lew difficult to manage; I accepted this difficulty as the natural flipside of his intellect and intensity. As soon as a Racker figured out the path to collaborate with Lew, working together was powerful. It was just that discovering the path took some people longer than others.

When I promoted Lew to president, my bet was a straightforward one — I believed I’d figure out how to make it all work. In StrengthsFinder fashion, we constructed teams to fit our strengths together for the betterment of the company and to minimize the effects of our flaws. StrengthsFinder was a good system for doing this, and Graham led it. But what probably helped me more than StrengthsFinder, in managing the dynamic partnership among Graham, Lew, and me, was thinking about the power of partnerships that had a dynamic tension I admired. I needed to understand partnership examples in which the partners couldn’t, as the saying goes, polish the diamond without friction.

When Lew, Graham, or I had disagreements, I wanted to be able to see the friction as critical toward polishing the diamond. In looking for examples, I decided I liked the one of Ronald Reagan and Tip O’Neill. They held different world views and policies, and as President and Speaker of the House they fought a lot, but in the end, showed loyalty to the country and accomplished a lot. “[What] both men deplored more than the other’s political philosophy was stalemate,” O’Neill’s son, Thomas, wrote in an op ed piece in the New York Times.

I thought that probably held true for Graham, Lew, and me. I also admired the partnership of Bill Clinton and Newt Gingrich. In the mid-1990s, they battled over spending cuts, but they respected each other. Gingrich wanted to slash spending and introduce a balanced budget amendment. Clinton wanted to spend money. He vetoed nearly every bill and resolution Gingrich put on the table, which resulted in a budgetary impasse so severe that the government shut down for three weeks. But after that, the men agreed to work together.

“[We] hammered out a really productive relationship,” Clinton later said. “We got our work done on time.” After they began meeting privately, they realized they could come to terms on many matters. In 1997, they passed the Balanced Budget Act. These examples of partnerships that had dynamic tension and yet achieved big results showed me that if we put in the effort, we could work through our differences.

Thinking about the examples helped me deal with our disagreements. Just as the politicians managed to put country first, I knew we had to put the company first. Assuming we developed differences of opinion over the ensuing years, I knew we wouldn’t be the first business growers to have differing views…